“We do not believe any group of men adequate enough or wise enough to operate without scrutiny or without criticism. We know that the only way to avoid error is to detect it, that the only way to detect it is to be free to inquire. We know that in secrecy error undetected will flourish and subvert”. – J Robert Oppenheimer.

Hinkley Point go-ahead delayed amid EDF funding doubts

If the UK’s energy strategy was not in enough trouble, more delays and doubt emerge over Hinkley Point.

The Telegraph report:

EDF has delayed its final investment decision on the Hinkley Point new nuclear plant yet again, amid claims it is still struggling to finalise funding for the £18bn project.

The French energy giant had been scheduled to take the long-awaited decision at a board meeting on January 27, but is now thought unlikely to do so until its annual results on February 16 at the earliest.

But it is reportedly still struggling to find the cash for its own 66.5pc stake, as its finances come under pressure from falling wholesale power prices and its acquisition of Areva’s reactor-making business.

A UK Government source indicated it remained confident EDF would proceed with Hinkley, which would be the country’s first new nuclear plant in a generation and is expected to deliver 7pc of UK electricity when it is scheduled to start operating in 2025.

But the continued delays to the project – once due to start generating in 2017 – are likely to raise further concerns about the UK’s energy strategy and the prospects for EDF being able to fund a second planned plant at Sizewell as well as a third, Chinese-led plant at Bradwell.

Artist’s impression of the proposed plant Photo: EDF

EDF had said in October that it would look to sell down its stake in Hinkley in due course but that it had “no time pressure to do so”.

Analysts at Bank of America Merrill Lynch said: "The key change with today’s report appears to be that a new financial partner could be a precondition to EDF’s ability to go ahead with the project.

"We estimate a 66.5pc stake in the project implies an equity investment of c€5.5bn in today’s prices, suggesting c€1.3bn in external equity is needed to reduce EDF’s share to just over 50pc."

EDF had originally been expected to use project financing for Hinkley, backed up by up to £16bn in UK Government guarantees via Infrastructure UK.

But Mr Lévy announced in October a “radical change” to what he said was a “more efficient” option of delivering its £12bn share of the project from EDF’s own balance sheet.

It has since emerged the UK had attached a sub-investment grade BB+ credit rating to the project.

The site where Hinkley Point will be built Photo: EDF

Unions in France have raised a series of concerns about EDF’s investment in Hinkley, which comes at a time EDF is shedding up to 6,000 jobs worldwide.

John Sauven, executive director of Greenpeace, said: "The EDF board is clearly rattled as they delay yet again this crucial investment decision. It could well signal curtains for Hinkley.

"EDF managers as well as employee representatives on the board are deeply concerned this project is too risky and too expensive.”

But Peter Atherton, utilities analyst at Jefferies, said he believed Hinkley would still proceed, especially as EDF had already spent £2bn on the project and the French Government wanted to export its reactor technology.

“We are so far down the line it would be staggering if it now collapsed,” he said.

“This is a colossally expensive project that is clearly and always has been a great strain on EDF’s finances – that’s why they brought the partners in and are looking to sell some more of the equity. It is pretty surprising we reach this stage with apparently some questions still unanswered."

A spokesman for the Department of Energy and Climate Change said: "Good progress continues to be made so that Hinkley can provide clean, affordable and secure energy that hardworking families and businesses can rely on now and in the future.”

EDF declined to comment.

It is now ten years since Tony Blair’s government gave the formal go ahead to new nuclear plants, but since then there has been delay after delay. The hoped for start up date of 2023 has already been ditched, and even if a final investment decision is made next month, it is unlikely the plant will be up and running before 2025.

And lurking in the background is Austria’s legal challenge to the EU over what they claim are illegal subsidies. This is just one of the giant risks that are putting off potential investors.

Does anybody in charge of our energy policy actually know what they are doing?

Related

Nope!
Of course, the companies who should be doing this work are our own energy suppliers like Centrica. Such companies, however, have been repeatedly kicked around as political footballs by successive governments, so simply don’t want to risk their shareholders’ money on huge major UK projects when so much depends upon relationships with politicians who they simply cannot trust. Frankly, cannot blame them.
So, we are left with overseas companies that actually believe the price guarantees given to them, but are only prepared to get involved if the profits seems massive.

How many times have we heard from some DECC minion that their policy will “provide clean, affordable and secure energy that hardworking families and businesses can rely on now and in the future?

What about the unemployed, the shysters and con men in the renewable energy and climate change industries, the lazy and corrupt bureaucrats and not forgetting the pensioners? Do they not need a clean, affordable and secure supply?

Instead of giving ‘aid’ to the rest of the world in the hope that someone might begin to like us and £25 million to teach Muslim women to speak English this government needs to step up to the plate, back British engineers and companies and get this plant (and a few more) built pronto!

Seeing as the sea level will be rising about 60 feet in the near future (h/t Al Gore), it appears to be foolish act, building it right next to the Severn estuary. Or maybe they were exaggerating somewhat?

Yes,they know exactly what they are doing.Cheap,clean coal powered electricity is not allowed.Comrades Cameron and Osborne have to do as they are told.So far they have had astounding success with enabling the demise of the aluminium,coal,and steel industries.
One can hope that some individual MPs can get together,and somehow persuade C.and O.to reject the Green nonsense that is killing us before it is to late.

Why did Gordon Brown sell off Westinghouse, the UKs only nuclear manufacturer, just as it was obvious that we would need new nuclear power stations? And why did Gordon Brown sell all our gold at the bottom of the market?

Yes the last straw would have been joining the euro
If he’d done that he would have been hunted down and shot
These guys do more financial damage than a war enemy and get off ‘scot free’
And he had the audacity to call me a ‘flat earther’ at the Copenhagen Climate coven while it snowed and the loony rent a crowd brigade tried to keep warm by burning the barricades that were put up to contain them … so funny

Yes a typical balanced BBC debate: A loony green ex-DECC minister who authored our current predicament – balanced by an even more loony green party Lord calling for even more batty policies. Wouldn’t want to have ‘false balance’ by getting an engineer on there or someone from the GWPF to talk sense. BBC clearly have licence to be as biased as they like on energy.

Washington Public Power Supply System (WPPSS) {aka whoops}
In January 1982, the WPPSS board stopped construction on Plants 4 and 5 when total cost for all the plants was projected to exceed $24 billion. Because these plants generated no power and brought in no money, the system was forced to default on $2.25 billion in bonds.